Question 1

Voters are making a choice to spend money on three projects: a dam, a school, or a road.In the choice between the dam and the school, the majority favors the school.In a choice between a dam and a road, the majority favors a dam.In a choice between a road and a school, the majority favors a road.These rankings indicate that majority voting may

Accepted Answer

A)  result in economically efficient outcomes because of rent-seeking behavior.
B)  reflect irrational preferences.
C)  produce inconsistent choices.
D)  lead to consistent choices in spite of irrational community preferences.E) All of the above
F) None of the above

Question 2

The median-voter model implies that a political office seeker will

Accepted Answer

A)  adopt more extreme views when seeking his or her party's nomination than when running against the other party's opponent.
B)  adopt less extreme views when seeking his or her party's nomination than when running against the other party's opponent.
C)  favor extensive government spending because demand curves for public goods are added vertically rather than horizontally.
D)  favor the private resolution of externality problems rather than governmental intervention.E) All of the above
F) A) and C)

Question 3

Politicians who have to go through elections tend to focus on the short-term net benefits of projects because of

Accepted Answer

A)  voters' tendency to more easily see short-term benefits rather than long-term ones.
B)  the special-interest effect of specific groups among the electorate.
C)  the ability of government to coerce people to do things involuntarily.
D)  pork-barrel politics and the principal-agent problem.E) None of the above
F) All of the above

Question 4

Pork-barrel politics is a good illustration of the "clear benefits, hidden costs" perspective of politicians.

Accepted Answer

A) True 
 B)False

Question 5

Rent-seeking behavior in public choice theory refers to

Accepted Answer

A)  politicians trading votes with one another.
B)  receiving perks and freebies from businesses trying to sway their votes.
C)  specific groups appealing to government for special benefits at someone else's expense.
D)  politicians getting low rent for their living quarters when government is in session.E) B) and C)
F) None of the above

Question 6

Government can use its ability to coerce toward improving economic efficiency by

Accepted Answer

A)  reducing the production of output with external benefits.
B)  reducing the production of output with public-goods characteristics.
C)  increasing the production of output with external benefits.
D)  increasing the production of output with external costs.E) A) and B)
F) All of the above

Question 7

Information problems create inefficient outcomes in

Accepted Answer

A)  the private sector but not the public sector.
B)  the public sector but not the private sector.
C)  neither the private nor the public sector.
D)  both the private and the public sectors.E) A) and B)
F) A) and C)

Question 8

Many state and local governments in the U.S.have balanced-budget laws in order to prevent politicians from

Accepted Answer

A)  creating a "small government" economy.
B)  succumbing to voters' strong preference for budget deficits.
C)  facing a principal-agent problem.
D)  collecting too much taxes.E) C) and D)
F) A) and D)

Question 9

Government's ability to reduce private-sector economic risks through laws and regulations would encourage all of the following, except

Accepted Answer

A)  higher levels of private economic investment.
B)  formation of new businesses.
C)  introduction of new products and processes.
D)  reduction of private goods and services.E) None of the above
F) B) and C)

Question 10

Regulatory capture in government happens because the people who are most qualified to supervise and regulate an industry oftentimes are or have been the leaders of the industry.

Accepted Answer

A) True 
 B)False

Question 11

The so-called collective action problem is the reason why

Accepted Answer

A)  taxpayers are not able to effectively counter special-interest groups.
B)  pork-barrel politics often fail to pass legislation.
C)  we have local and national elections.
D)  majority voting can lead to economically inefficient outcomes.E) B) and D)
F) A) and C)

Question 12

Which would be an avenue for resolving the inefficiencies associated with majority voting?

Accepted Answer

A)  the paradox of voting
B)  progressive taxation
C)  proportional taxation
D)  special-interest groupsE) B) and D)
F) A) and D)

Question 13

The political technique called logrolling

Accepted Answer

A)  always increases economic efficiency.
B)  always decreases economic efficiency.
C)  involves trading votes to secure favorable outcomes that otherwise could be rejected.
D)  is an example of the paradox of voting.E) None of the above
F) A) and C)

Question 14

In the median-voter model, half the voters have stronger or more positive preferences than the median voter, while half of the voters have weaker or more negative preferences.

Accepted Answer

A) True 
 B)False

Question 15

In making sure that laws are uniformly enforced and applied, one consequence is that government creates inflexibility.

Accepted Answer

A) True 
 B)False

Question 16

Government loan guarantees tend to socialize gains and privatize losses.

Accepted Answer

A) True 
 B)False

Question 17

In the median-voter model, the median voter refers to the voter who makes her choice at the midpoint of the voting period.

Accepted Answer

A) True 
 B)False

Question 18

The Road Runner Club contributes money to Senator Sly's reelection campaign fund, and Senator Sly helps pass legislation to add more jogging paths across the state.From this we can definitively conclude

Accepted Answer

A)  that political corruption has occurred.
B)  that logrolling has occurred.
C)  that a principal-agent problem has occurred.
D)  nothing; the Road Runner Club may have donated to Senator Sly because he already supported the jogging paths.E) B) and C)
F) A) and D)

Exam 5: Governments Role and Government Failure

Many state and local governments in the U.S.have balanced-budget laws in order to prevent politicians from

Correct Answer
verified

The political technique called logrolling

Correct Answer
verified

Government's ability to reduce private-sector economic risks through laws and regulations would encourage all of the following, except

Correct Answer
verified

In the median-voter model, the median voter refers to the voter who makes her choice at the midpoint of the voting period.

Correct Answer
verified

Rent-seeking behavior in public choice theory refers to

Correct Answer
verified

In making sure that laws are uniformly enforced and applied, one consequence is that government creates inflexibility.

Correct Answer
verified

Politicians who have to go through elections tend to focus on the short-term net benefits of projects because of

Correct Answer
verified

In the median-voter model, half the voters have stronger or more positive preferences than the median voter, while half of the voters have weaker or more negative preferences.

Correct Answer
verified

Information problems create inefficient outcomes in

Correct Answer
verified

Government can use its ability to coerce toward improving economic efficiency by

Correct Answer
verified

Government loan guarantees tend to socialize gains and privatize losses.

Correct Answer
verified

Pork-barrel politics is a good illustration of the "clear benefits, hidden costs" perspective of politicians.

Correct Answer
verified

Regulatory capture in government happens because the people who are most qualified to supervise and regulate an industry oftentimes are or have been the leaders of the industry.

Correct Answer
verified

Which would be an avenue for resolving the inefficiencies associated with majority voting?

Correct Answer
verified

The Road Runner Club contributes money to Senator Sly's reelection campaign fund, and Senator Sly helps pass legislation to add more jogging paths across the state.From this we can definitively conclude

Correct Answer
verified

The median-voter model implies that a political office seeker will

Correct Answer
verified

The so-called collective action problem is the reason why

Correct Answer
verified

Correct Answer
verified

Exam 5: Governments Role and Government Failure

Many state and local governments in the U.S.have balanced-budget laws in order to prevent politicians from

Correct AnswerverifiedShow Answer

The political technique called logrolling

Correct AnswerverifiedShow Answer

Government's ability to reduce private-sector economic risks through laws and regulations would encourage all of the following, except

Correct AnswerverifiedShow Answer

In the median-voter model, the median voter refers to the voter who makes her choice at the midpoint of the voting period.

Correct AnswerverifiedShow Answer

Rent-seeking behavior in public choice theory refers to

Correct AnswerverifiedShow Answer

In making sure that laws are uniformly enforced and applied, one consequence is that government creates inflexibility.

Correct AnswerverifiedShow Answer

Politicians who have to go through elections tend to focus on the short-term net benefits of projects because of

Correct AnswerverifiedShow Answer

In the median-voter model, half the voters have stronger or more positive preferences than the median voter, while half of the voters have weaker or more negative preferences.

Correct AnswerverifiedShow Answer

Information problems create inefficient outcomes in

Correct AnswerverifiedShow Answer

Government can use its ability to coerce toward improving economic efficiency by

Correct AnswerverifiedShow Answer

Government loan guarantees tend to socialize gains and privatize losses.

Correct AnswerverifiedShow Answer

Pork-barrel politics is a good illustration of the "clear benefits, hidden costs" perspective of politicians.

Correct AnswerverifiedShow Answer

Regulatory capture in government happens because the people who are most qualified to supervise and regulate an industry oftentimes are or have been the leaders of the industry.

Correct AnswerverifiedShow Answer

Which would be an avenue for resolving the inefficiencies associated with majority voting?

Correct AnswerverifiedShow Answer

The Road Runner Club contributes money to Senator Sly's reelection campaign fund, and Senator Sly helps pass legislation to add more jogging paths across the state.From this we can definitively conclude

Correct AnswerverifiedShow Answer

The median-voter model implies that a political office seeker will

Correct AnswerverifiedShow Answer

The so-called collective action problem is the reason why

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

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